In business, one seeks to establish a sustainable long-term competitive advantage — something that allows you to outperform or outlast others.

Cities provide multiple competitive benefits: their compactness directly affects time, energy, and resource efficiency. In addition, cities generate new ideas and cultural experiences by bringing together a critical mass of diverse people.

While technology has certainly made it possible for people to work from just about anywhere, this is really only useful for executing work which has already been broadly defined; when it comes to generating new ideas nothing beats face-to-face interaction. It is simply a higher-bandwidth form of communication, and ideation requires trust and some level of long-term interaction.

Car culture is inefficient and runs counter to a lifestyle designed primarily around face-to-face interaction and ideation. Idea-based industries (advertising, banking, technology) have long flourished in urban environments — the kind in which walking, bicycling, and public transportation are the most effective modes of transport.

The very idea of parking is a ridiculous and outdated concept. The notion that we should devote land, tie-up business resources in this feudal enterprise, and perhaps most ridiculously spend time looking for parking spots should convince anyone that this arrangement is not sustainable.

The strategic competitive advantages of cities are clear and incontrovertible. But if cities are so great, why are ours in such terrible shape?

Take Cleveland, for Example…

Most arguments against the benefits of cities tend towards the “Yeah, but” flavor — citing examples of how specific cities have failed. Such arguments are more informed by historical economics than by rational analysis of the present or future.

The argument in support of cities is deductive: inefficiency costs money, cities are more efficient, therefore cities have an advantage. The arguments used against cities are inductive: our cities have not worked well, therefore no cities can ever work well. One possibly valid reason to doubt the deductive argument is the very fact that so many people believe the inductive argument to be valid: the deductive argument can be invalidated only if the presumed efficiency never exists, which could happen if a critical mass of people does not accrue to realize it. Thus, the only thing in the way of a more efficient American future is our own doubt that it is achievable.

Here’s how Americans have been duped about the nature of cities, and how we can overcome our 20th Century biases to realize the sustainable competitive advantage that awaits us in our cities.

Industry

Industrial America was not a particularly pleasant place. Cities were crowded with workers, factories, coal smoke, animal waste, polluted waterways, and with the possible exception of New York’s Central Park were not designed environments in any way. It is quite understandable that people of means would have wanted to separate themselves from “common workers” and remove themselves to land surrounding the city. After all, land was the ostensible indicator of wealth for generations. Speaking generally, city centers were thus for people of lesser wealth.

Immigration

America’s great industrial centers required a vast supply of workers, and they came from across the globe. Each new wave depressed wages, which made them seem less desirable than the last, and clashing value systems created a constant xenophobic revulsion that made for de-facto segregated neighborhoods. Not wanting to risk these vagaries or witness these shifts, many opted for less dense, more stable environments.

Unions

Large numbers of low-wage workers densely packed in urban centers could be readily organized for collective bargaining. Henry Ford, in particular, hated this idea, not because he opposed the interests of those being organized, but because he hated the idea of someone profiting from those organizing activities. Ford was deeply anti-Semitic and he ascribed everything from banking to labor organizing as an evil influence of the Jew on the pastoral idea of the progress of industry.

As much as anyone else, Henry Ford invented the suburb and he did it to prevent workers from becoming organized. The Model T, and the suburban hierarchy it enabled, were not only the products of his business — they were a design element in the industrial, suburban future that Ford helped to create.

Industrial Consolidation

It is common to throw around words like “industrial decline” and to talk about the “rust-belt”, but the fact is that the post-war period was marked more by prosperity and consolidation than any kind of “decline.”

The capitalist system was just doing what it is supposed to do: create value for shareholders by eliminating inefficiency, and in many cases firms followed Ford’s example by relocating to suburban locations where land was cheaper and unions could be more readily controlled.

Reflexivity

Reflexivity is the idea that market participants can affect a market just by observing it. For example, a currency trader with an established track record can move a currency merely by stating an intention to take a position. In the same way, cyclical disinvestment in cities was launched by corporations who began to systematically disinvest in cities as part of their consolidations.

Systematic disinvestment in downtown areas by corporations led to a cycle of negative effects, almost all of which are what people mean when they talk about our “urban ills.” But as intractable as these problems seem, they do not negate the deductive argument in favor of urban environment. Instead, the argument is more along the lines of Yogi Berra’s, “No one goes there anymore — it’s too crowded,” which is both fallacious and clearly informed primarily by human perception.

Feudal Equilibrium

Reflexive disinvestment has affected politics in particular. Populations in many American cities are off 40% or more from their historical peaks (around 1950). Voter engagement in municipal elections has been abysmal; city officials are often elected on turnout under 25% and by margins of just a few thousand votes.

As a result, city politics often pulls in people more interested in using these positions for their own personal gain than for the greater good. However, there is a catch: if the abuses are too egregious, even more people will leave the cities and the parasite will kill its host. And so we end up with a kind of Peter principle of public service: each post is filled by someone competent enough to survive minimal public scrutiny and still get away with whatever shenanigans is motivating them. (Obviously this cannot be a fair characterization of every individual, but it is descriptive of the system as a whole.)

The political power establishment thus wishes to prolong this state of affairs; attracting large numbers of new, middle class voters will assuredly end their reign. So they do not advocate this; instead of implementing designs that would attract real investment, they talk about “getting tough on crime” and “fixing our schools,” and sometimes they genuinely believe they can address these problems. However, these issues are just final effects of reflexive disinvestment; fix that and crime and schools will fix themselves.

American Exceptionalism

Americans are too often blind to lessons from other parts of the world. Europeans are too effete and socialistic; Asians are too “foreign”. And everybody else, with few exceptions, is the enemy. We are not terribly good at stealing ideas from elsewhere, and we tend to over-value our own experiences.

Detroit’s current failures do not mean that cities are inherently ungovernable or inefficient. Tokyo, Berlin, Paris, London, Shanghai, Seoul and countless others serve as examples of livable modern cities that are being productively adapted with 21st century designs. Within the US, a few cities like Portland offer hints at what can be.

If one is going to try to argue against a deductive argument using an inductive one, it could at least be complete and balanced.

“But I Like the Suburbs…”

Thankfully, everyone is different. And often I hear people say, “But I like living in the suburbs.” Or they point out that I (or others) did or do. [Full disclosure: I have lived in the suburbs, worked in the suburbs and the city, went to college in the city when I was younger, and just bought a house in the city because I think now is a good time to make that investment; I am also tired of spending time driving.]

But here again it is inappropriate to try to use single individual examples to invalidate the general deductive argument. I am also not making a judgment about the relative value of the city or the suburbs. Too often people feel that their lifestyle is being threatened, and that is not the point of this argument. The only relevant issues are economic: if someone wishes to live in the suburbs, they should expect to pay for it with time, fuel cost, relative isolation, and a potential long-term political marginalization.

Right now, we are subsidizing the suburbs with fuel costs which do not account for environmental externalities. There is no reason to expect this to continue; however even if it does, energy will never be free. Suburbs are a bad economic bet for this reason alone.

Race and Partisan Politics

These two issues are so complex and divisive, I will refrain from discussing them here, despite the fact that I have considered them both in great detail. Each deserves a post (or a volume of books) in its own right.

However it should be said: race is not important to the deductive argument, and neither is partisan politics. Positive, reflexive investment in cities will make them efficient, productive, and diverse; this is a centrist idea that should make both the left and the right happy. Politics and race are both issues that have all-too often been hijacked by people looking to promote their own interests, and Americans have been historically unable to perceive any issue free of these lenses.

Placing Bets on the Future

The long-term strategic advantage that cities can provide (specifically through time, energy, and resource efficiency) is not made any less real by our past failures; America’s cities are indisputably its best hope for the future. The natural evolution of the American economy tends towards higher-order activity, and will ultimately settle on creativity and design at its apex. The longer we wait to begin a cycle of positive, reflexive investment in our cities, the longer we stall our country’s competitiveness and our ability to innovate.

We must only convince ourselves that a more efficient and livable future is possible; the rest will follow.

Nearly every weekday between 4:00 and 7:00pm, eastbound US Route 50 in Annapolis, Maryland comes to a standstill. It typically happens near the westernmost edge of the city, and for a distance of roughly 7 miles, traffic inches along at a speeds often less than 10 miles per hour.

Yesterday it took me 30 minutes to cover these 7 miles (5:30 to 6:00pm).

It would be one thing if it was just me that was inconvenienced, or if this was a result of an accident or some unusual circumstance, but not so: this happens every day and there are tens of thousands of people affected by it. There is nothing unusual about it. We can only infer that this is how the road was designed to operate.

It would also be one thing if it was just this stretch of Route 50 that was affected by this kind of thing, but we all know it’s not. The Washington Beltway, to take one well known local example, is also apparently designed to fail spectacularly every morning and afternoon (and sometimes in between).

What does it say about a society that has its citizens sit in bumper-to-bumper traffic, day in and day out, spewing CO2 and other pollutants and wasting their time?

To me, it’s a sign of contempt. Anyone that would knowingly have people spend their time (and fuel) this way, day after day, must be filled with utter disdain for those so effected. Who’s to blame for these designs?

Surely there are some highway planners and road builders that could take the blame, but I have to think that any changes to the roads themselves can only yield marginal improvements — however needed those improvements may be.

The real issue boils down to us — the citizenry — and where we invest our financial and political capital. We are to blame.

We are the ones who have repeatedly failed to fund public transportation initiatives acquisto viagra. We are the ones who have lacked the foresight to discourage long distance car commutes. Annapolis residents famously rejected the extension of the Washington DC metro along the US 50 median because it would “bring crime” from the big city. Now Annapolis is its own capital of crime, and DC is further away than ever by car. And the median strip that once could have accommodated the metro has been sacrificed to ineffective additional lanes. Opportunity lost.

So, there you have it: we’ve locked ourselves into an economic model that provides long term competitive disadvantage. While other countries make good use of public transport and respect people’s time by moving them around efficiently, lowering pollution and making people more productive in the process, we’re stuck in the 1970’s, with people killing 2-4 hours per day in their cars spewing gases. Nice.

Severn River Bridge Backup, US 50

Miles

7

Lanes

5

Hours in Backup

0.5

Average Car Length (ft)

20

Number of Cars/Lane

1848

Number of Cars

9240

Number of Cars/Hour

18480

Number of Hours/Day

3

Number of Cars/Day

55440

Idle Fuel Consumption/Hr

0.5

Gallons Fuel/Car

0.25

Fuel Cost

1.6

Fuel Cost/Car

0.4

Total Cost/Day

$22,176.00

CO2 Generation/Gallon (lb)

22

Total Gallons Gas

13860

Total CO2 Output

304,920.00

Tons CO2 Output

152.46

Man Hours

27720

Average Hourly Rate

$15.00

Lost Value

$207,900.00

So every day, by design, this SINGLE stretch of Route 50 causes at least $207,900.00 in lost productivity for people, costs $22,176.00 in fuel (at $1.60/gallon — try it at $3.99), and generates 152.46 TONS of CO2 output. And that’s when it’s working AS DESIGNED! This is what it’s SUPPOSED to do??!?

Go ahead and add in every other backup in Maryland — the DC Beltway, the Baltimore Beltway, I-95, I-83 for starters — and you’ll have an amazing amount of lost time, energy, and productivity! It’s staggering what a drag this is on our economy. And the first instinct we citizenry has is to expand the current roads and build new ones. And this won’t help!

The only things that will really help are to 1) work closer to where you live, 2) use public transportation or bikes to get there, 3) improve the design of the roads we have.

The inability (er, unwillingness) to make this happen in suburban America is why places that have better public transportation (and the vibrant work/residential communities that invariably build up around it) will outpace us in the long term.

We simply can’t compete in the world economy if we’re locked up in our cars.

For too long, the educated class has held an unspoken compact: nerds, you worry about computers and gadgets and Battlestar Galactica; dreamers, you worry about art and experimental thought and the environment and plants and music. And generally speaking, the less these two crowds had to see each other, the happier they tended to be.

This was OK in an era like the 60’s where, for the most part, computing was best reserved for invoices, and fine art had little to do with math. The computer guys were needed to figure out hard implementational problems: how to store all those invoices and be sure the numbers were right, or the math behind making sure a rocket flew straight. Good, tough problems of the era, to be sure, but almost entirely orthogonal to the guys dreaming up the tailfins on the cars and the ads that sold them. Think about the role of geeks in era-pieces like Mad Men and The Right Stuff and you get an idea of how oil-and-water these crowds were.

Fast forward to today, where computers are a creative instrument capable of fine-art quality interaction in multiple media: video, still photography, sound, music, animation, visualization, and even the creation of physical interactions and physical objects. 3D printing, computer controlled robots and art machines, physical art installations of awesome complexity, and autonomous digital art objects are not only possible, but they are accessible to average people who simply want to create. We have truly entered an era where the walls between technical and creative have been razed, however if we fail to realize it and move past them, we may find ourselves constrained by an older notion of what’s possible.

As an example, I’ll take last night’s Ignite Baltimore #1, at which I was proud, honored (and a tad nervous) to be speaker #1. The topics covered were vast and varied, and I’d argue were just the kind of fuel that Baltimore’s creative class needs as input as we set off to solve the challenges of the next 50 years. The topics, in no particular order: public transportation, urban gardening, public spaces, the bible, web apps, agile development, 100 mistakes, cognitive bias, east coast industrial landscapes as art, radio stories, writing vs. speaking, entrepreneurial experience, and much more.

I’d argue that this is the kind of wide ranging liberal arts discussion that most nerds would have opted out of in the past, and that nerds would not be the preferred audience of the dreamers, artists, and poets. The magic of today, however — the true genius of the moment here in 2008 — is that this cross-fertilization is finally starting to happen. And freely and with passion. Why? Because these walls between creativity, art, science, and math, have finally started to wear down — and not just in some university’s interdisciplinary studies department — but in popular culture and conceptions. The mashup is now considered not just a valid art form, but a standard process for solving today’s toughest problems.

Creative thought has achieved primacy. It is now the idea that matters, because when the idea is properly and fully conceived, the design, presentation, and implementation are necessarily correct as well. What do I mean by this? If there is total integration between the processes of ideation and implementation, there is simply no separation between an idea, the thought models that underly it, and its implementation in digital form: they are one.

It used to be that there was a wall between a digital implementation and an idea; a digital implementation would involve “hacks” — making stuff work in spite of memory or display or other limitations — and the computer-enabling “portion” of a solution would be some subset (usually a rather compromised subset) of an overall idea.

Today, object oriented programming and database technology make it possible to model a solution end to end with few compromises; so, in fact, digital implementers become full partners in the design conversation, greatly eliminating waste, and empowering programmers creatively. Agile development practices (involving iteration rather than top-down design) and story-based development (giving non-programmers a “narrative” to follow about the “story” of their solution) make it so there is very little distinction between design, programming, and ideation. They are now effectively the same disciplines.

And this explains why so many have argued that we are entering a new era of the right brain and of the “rise of the creative class.” The fact is if any of this had been possible sooner, it would have happened sooner. Generally speaking, people don’t like being pigeonholed into some tiny specialty, or to have their thinking constrained. We are human; all of our brains have two halves. But for too long, we have all likely underutilized one side or the other.

So, now we are all free; now, united with better tools and better processes, it is time to turn our attention to the hard, human problems of our age: energy, hunger, the environment (built and natural), and meaning, to name a few. And the topics at last night’s Ignite Baltimore were just the right fuel for getting us started thinking about these hard problems.

Kennedy famously said that “we choose to go to the moon… not because it is easy, but because it is hard.” Our generation needs to start to figure out how to apply the massive wealth of talent (and newfound technical+creative skills) to the truly hard problems of our age.

It’s not going to happen overnight, and we all don’t need to go out and start wind power companies. But, we all must make ourselves open to BOTH sides of our brains. We must realize that it is poetry and art which will provide the insight we need to make technical breakthroughs. We must listen to each other and be open to diverse viewpoints. We must become spiritual beings — it doesn’t matter whether your spirituality comes more from The Force than The Bible or The Koran — but to deny oneself any of the channels of thought that inform our basic human nature is to cut yourself off from the great insights and genius of one’s humanity.

Be open. Listen to people. Look at diverse kinds of art. Listen to diverse kinds of music. If you want to take part in the next great wave of innovation, these are the kinds of fuels you’ll need to do it. And I hope to see you at the next Ignite Baltimore in February 2009, where we can continue this conversation!

I would not have anticipated ever writing anything with this thesis: Fidel Castro was right.

A couple of years ago, he made it known that the global subsidy of biofuels would lead to an increase in the price of food because of the diversion of grain stocks (such as corn) into fuel production.

It seemed basic economics at the time and he’s been proven correct. We saw it in the developed world first in the form of an increase in the price of milk (made from corn, essentially) and subsequently all dairy products.

Now we see it in the form of other grains, like rice and wheat, and there is no obvious end in sight. The craze to invest in biofuel technologies was nothing other than a stall tactic, to prevent investment in real alternative energy sources. While it’s nice to re-use things like old fry oil to run your Mercedes or semi, there just isn’t enough used restaurant oil to make a dent in our demand for energy.

Instead we’ve taken the final step in linking our food supply to the energy market: we’ve decided to invest heavily (and irrationally) in converting our food directly into energy with ethanol and soy biofuel subsidies.

It’s not as though there had not previously been a link; oil companies have been powering agribusiness for the last 75 years at least. Petroleum waste products have been productively combined with chlorine and other chemicals to produce a huge number of chemicals that have proved useful as pesticides (and as PCBs, PVCs, and other plastics) and have led to the current abundance of food.

Ostensibly, this is a good thing; however as this has occurred, farming has become big business, and the same corporations that control the chemistry of the food supply (like Monsanto and Exxon/Mobil) now control the food supply itself. There’s no monopoly like two monopolies.

If this theses are correct, one of the best things we can do to lower food prices and to promote investment in sustainable alternative energies is to loudly protest the investment in biofuels.

By removing subsidies for biofuels, we 1) direct food back to the food supply, thereby easing prices, 2) promote investment in sustainable alternative energy solutions, 3) agitate the monopoly link between corporate farms and the petroleum products they use, 4) put additional pressure on automakers to seriously consider the development of non-petroleum powered and, certainly, of non-biofuel powered vehicles.

So, I exhort you: help stop the subsidy of biofuel production. If there is a natural market for it, it will stand on its own.

Otherwise all we’re doing is making food less affordable, creating agony for countries that can’t afford these price increases, and extending the life of the petroleum monopolies.

Certainly new technologies like slow discharge capacitors hold real promise. Let’s develop these ideas and show the oil companies that their stranded costs are their responsibility, not ours.